- To whom it may concern

On 9 October 2008, the Icelandic Financial Supervisory Authority
("FME") appointed a Resolution Committee of Kaupthing Bank hf. (the"Bank"), in accordance with article 5 of legislative act 125/2008 on
the Authority for Treasury Disbursements due to Unusual Financial
Market Circumstances etc (the"Act"). The Act was passed by Parliament
on 6 October 2008, providing the FME with the authority and power to
intervene in the operations of financial undertakings with the aim of
responding to the unusual circumstances in the Icelandic financial
market.

According to the Act and the subsequent decision of the FME, the
Resolution Committee has all the powers of the Board of Directors of
the Bank, pursuant to the Act on Public Limited Companies. In this
respect the Resolution Committee undertakes all affairs of the Bank,
including supervision of its assets and its business operations.

The Resolution Committee focuses on protecting the assets of the Bank
as well as maintaining the Bank's basic operations and the integrity
of the Icelandic banking system. In order to achieve this, payments
of claims other than priority claims have been stopped in order to
secure the rights of creditors of the bank and to ensure their equal
treatment.

On 21 October 2008, the FME decided to transfer a part of the Bank's
operations to a New Kaupthing Bank hf. that has been incorporated and
which is fully owned by the Icelandic Government. This decision has
been made to ensure continued banking operations for Icelandic
individuals and businesses. The decision means, inter alia, that the
New Kaupthing Bank hf. takes over all of the Bank's deposits in
Iceland, and also the bulk of the Bank's assets that relate to its
Icelandic operations, such as loans and other claims. In turn the FME
has decided that New Kaupthing Bank hf. shall issue a bond to the
Bank, equivalent to the surplus of assets over liabilities at fair
value (based on a valuation by independent parties, see further
details in FME's decision of October 21). Other assets and
liabilities will remain in the Bank, which will in turn remain under
the control of the Resolution Committee. A final settlement between
the New Kaupthing Bank hf. and the Bank will be made within 90 days
from the FME's decision. An English translation of the decision can
be found on the FME's website at the following address:
http://www.fme.is/lisalib/getfile.aspx?itemid=5725

The Resolution Committee of the Bank are pleased to announce the
appointment of the UK limited liability partnership of Deloitte &
Touche LLP ("Deloitte") to assist with the communication and
consultation with all remaining creditors of the Bank, including
creditors of its international branches.

It is the Resolution Committee's intention to provide regular update
information to all creditors of the Bank through the website
www.kaupthing.com/creditorinformation. Deloitte will be assisting the
Bank's Resolution Committee to set up an informal committee of
creditors representing a broad cross section of financial
institutions, international deposit holders, and other creditors.
Subject to the creditors' committee members entering into strict
confidentiality undertakings, the Resolution Committee, with the
assistance of Deloitte, intend to consult with the creditors'
committee on plans for realising the assets of the Bank and making
payments to creditors.  In this regard, direct contact will be made
with known creditors of the Bank as soon as possible over the course
of the next few days.

Those creditors of the Bank wishing to register their interest in
this regard are invited to contact The Bank through the following
email address: creditorcontact@kaupthing.com

For and on behalf of

The Resolution Committee of the Bank

Disclaimer: This release is for informational purposes only and shall
not be made legally binding towards Kaupthing Bank hf. or the
Resolution Committee. Should there be any discrepancy between the
text of the release and Icelandic legislation or any of FME's
decisions, the latter shall prevail.